0575-AD08 202304 Unified Agenda of Federal Regulatory and Deregulatory Actions 0575 Rural Housing Service RHS 0500 Department of Agriculture USDA Single Family Housing Guaranteed Rural Housing Programs--Delegated Approval Authority and Strengthening Management Oversight - Final rule.

The Rural Housing Service (RHS) published a proposed rule on August 4, 2022 [87 FR 47646] to amend the current regulations for the Single-Family Housing Guaranteed Loan Program (SFHGLP) regulation found in 7 CFR part 3555.  A 60-day comment period was provided for the proposed rule, which closed on October 3, 2022.  RHS received comments from 41 respondents, of which one of the comments was not applicable to the contents of the rule.  Of the comments received, 30 were from mortgage lenders, one was from a public assistance agency, and ten were from other members of the public. 

As a result of the comments received, Rural Development anticipates including in the Final Rule the opportunity for Delegated Lenders to submit files to the Agency for review and approval, in some circumstances.  In addition, Rural Development will consider the recommendations on oversight sample size and the roll-out timeframe in development of the final rule. The Agency will also add 7 CFR 3555.55 to grant Delegated Lenders the authority to approve and execute loan guarantees with limited to no involvement of Agency staff. The provisions include the following:

 (1) The Agency may grant Delegated Lenders the authority to approve loans and obtain Loan Note Guarantees with limited to no involvement of Agency staff.

 (2) The Agency would reserve the right to suspend or terminate any lender’s delegated status for reasons including, but not limited to, underwriting loans which do not meet Agency guidelines, providing data to the Agency’s automated underwriting system which is not supported by documentation retained by the lender, maintaining a portfolio that does not meet the established delinquency, loss claim, and default rate performance metrics, and other criteria described in Agency loan program requirements in 7 CFR 3555, and any other regulatory guidance issued.

 (3) Delegated Lenders would be required to use the Agency’s automated underwriting system as described in 3555.107(b) Automated underwriting.”

 (4) The Agency would monitor ongoing delegated authority (DA) eligibility using regular collection and analysis of loan level data and performance, as well as through lender oversight reviews/examinations.

The changes to 7 CFR 3555 are expected to improve the efficiency of the delivery of the SFHGLP, align Agency practices with industry standards, and provide the public, specifically low- and moderate-income households, with faster and better service by eliminating Agency intervention at loan origination through closing.

]]> Other Significant Previously Published in The Unified Agenda Final Rule Stage No No 7 CFR 3555.51 7 CFR 3555.55 42 U.S.C. 1487, Rural Housing Insurance Fund No Proposed Rule 08/04/2022 87 FR 47646 NPRM Comment Period End 10/03/2022 Final Rule 01/00/2024 No No None No No No Sara Thieleke Deputy Director, SFH 0575 Rural Housing Service RHS 715 345-7664 sara.thieleke@usda.gov 1400 Independence Avenue SW, Washington DC 20250 Joaquin Tremols Director, SFH 0575 Rural Housing Service RHS 202 720-1465 joaquin.tremols@wdc.usda.gov 1400 Independence Avenue SW, Washington DC 20250 Ticia Weare Finance and Loan Analyst, SFH 0575 Rural Housing Service RHS 702 407-1400 6001 ticia.weare@usda.gov 1400 Independence Avenue SW, Washington DC 20250